Opponents of a $950 million tax increase for education have seized on comments by Gov. John Hickenlooper to bolster their claim that if Amendment 66 passes, the money will be used to "backfill" the state's pension system instead of going to students.

The dispute signals a broader argument that has been brewing since the inception of Amendment 66. Opponents claim the tax hike is a coup for unions and an ailing retirement system, while supporters argue language in the ballot measure makes it clear the money has nothing do with fulfilling current obligations to the Public Employees Retirement Association.

"PERA is a totally separate issue from Amendment 66," said state Sen. Mike Johnston, D-Denver, the architect of the ballot measure.

He and other supporters of Amendment 66, which is on the Nov. 5 ballot, called the PERA issue a red herring, a gotcha and the latest Hail Mary pass from opponents wanting to kill the measure.

Denver Republican Joshua Sharf, a blogger who heads The PERA Project for the free-market Independence Institute think tank, asked the governor Oct. 8 about Amendment 66 and PERA at an event where Hickenlooper was touting the ballot measure.

Sharf waited until Oct. 16 — the day after ballots first were mailed to voters — to write a blog post about their exchange. "Gov. Hickenlooper admits: Districts can use Amendment 66 money for PERA," the headline blared.

But did he?

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"The headline is grossly misleading," Hickenlooper told The Denver Post.

Critics of Sharf's blog said the governor was answering a question about a 2010 PERA reform measure, which requires employees and their employers to increase their contributions to help reduce pension liabilities. State workers pay the additional contribution amount required, but most school districts — thus the taxpayers — have borne the costs that were to be shared with their employees.

"They have not split it; they've just swallowed it," Hickenlooper said, during the exchange with Sharf.

"Right, that's what I mean, is that they've basically just swallowed it," Sharf said.

"Well, if you want to fix that, if that's what's happening, then we can't legislate that," Hickenlooper replied, in part. "There's a certain amount of money that goes into the districts, and that is the way our education system is structured."

Sharf said the exchange formed the basis for his blog post and his headline.

"I believe the opposition read into a comment by our governor to make it say what they wanted it to say when the truth is Amendment 66 has nothing to do with PERA," said Lynea Hansen, executive director of Secure PERA, a coalition of retirees and government employees.

Even if it fails, school districts still are obligated to pay into the retirement system, which lawmakers attempted to shore up with the bipartisan reform measure passed in 2010.

At the time the law was passed, the Jefferson County School District had frozen salaries, Superintendent Cindy Stevenson said.

The following year, the district cut salaries by 3 percent and the next year kept that 3 percent cut in place.

In the current school year, employees are back at their 2010 salary levels, she said.

In essence, she said, they have paid that increased PERA contribution required under Senate Bill 1.

"Our employees, I believe, have contributed more than fairly to their PERA," Stevenson said.

"Now, if we ever have money again and we are ever negotiating increases again and we can ever go more than 1 or 2 percent ... then I think it's a very fair, rationale conversation about what's the right balance."

Cherry Creek School District also absorbed the increase while preserving programs and class sizes, freezing some salaries, said Guy Bellville, the district's chief financial officer.

The Adams 12-Five Star school board did pass the additional PERA cost onto employees in the form of a 1.5 percent salary reduction in the 2012-13 school year, district spokesman Joe Ferdani said.

And a portion of a benefits compensation package for the current school year includes 1.5 percent for salary increases and 1 percent toward the additional PERA contribution, Ferdani said.

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